How WN Will Beat US (And Others_

[vantheman63]

So, go to www.southwest.com and check out the pitch (and positioning):

"Our Low Fares Really Are Low"

Other Airlines:
Non-Refundable Fare - $89
1st Bag - $15
2nd Bag - $25
Window Or Aisle Seat - $20
Curbside Check In - $4
Subtotal - $153
Change Fee - $100 (Isn't it $150 now???)
GRAND TOTAL - $253

Southwest Airlines:
Non-Refundable Fare - $89
1st Bag - FREE
2nd Bag - FREE
Window Or Aisle Seat - FREE
Curbside Check In - FREE
Subtotal - $89
Change Fee - FREE
GRAND TOTAL - $89

And of course, WN doesn't charge to redeem FF tix....and wait till they have a field day with US on the charge for a soda or something...or heck, even a drink, which is free with "Business Select."

In the words of David Siegel...."they are coming to kill us/you."

And the crazy part is....you're handing them the friggin bullets, grenades and rockets.

Just AMAZING!!!

 

[Hey.. Chill Out]

They're going to beat us by doing what theyve done for 30 years now.

 

[UPNAWAY]

Yep, they have the Perfect Storm, much of their own creating just to keep on keeping on. If I was SW I would not mind suffering small losses for the forseable future while the others suffer huge losses and not change a darn thing.

 

[FlyUs]

Good for them. Their fuel hedges have definitely made them more competitive. That is not the position here at US or any of the other legacies.

 

[Dog Wonder]

As long as they keep paying US Airways under the table to keep Parker and Kirby, Parker and Kirby will keep doing the dumb stuff Southwest wants.

Where is the SEC?

 

[vantheman63]

As long as they keep paying US Airways under the table to keep Parker and Kirby, Parker and Kirby will keep doing the dumb stuff Southwest wants.

Where is the SEC?

Funny....I actually wondered to a friend..."I wonder if any of the Sand Fleas infesting the Sand Castle own stock in WN???"

With some of the decisions we're seeing....makes one wonder.

 

[Be Careful What You Wish For.]

As long as they keep paying US Airways under the table to keep Parker and Kirby, Parker and Kirby will keep doing the dumb stuff Southwest wants.

Where is the SEC?

Are you talking about downsizing the "burgh"?

If so there are plenty of positions available in PHL-so I'm told.

 

[nycbusdriver]

Good for them. Their fuel hedges have definitely made them more competitive. That is not the position here at US or any of the other legacies.

You're right. But using fuel hedges to keep the prices low is not really sustainable for a single carrier the size of SWA. They are using their gambling winnings to subsidize customers ticket costs.

Fuel hedging is gambling, pure and simple. SWA has been notoriously successful at it; Parker and the Tempe brain trust has been notoriously terrible at it.

If I owned a good sized company that sold widgets at retail, and subsequently won $250 million playing the PowerBall lottery, I could use those winnings to undercut all my competitors selling their widgets. I could slash my prices to half of my competitors' and thereby have the pricing power to hurt them, possibly mortally. That's what's happening right now in the airline business. SWA has the pricing power because they play a great game of oil-price poker, not because of their admittedly efficient business model.

 

[jimntx]

In the words of David Siegel...."they are coming to kill us/you."

And the crazy part is....you're handing them the friggin bullets, grenades and rockets.

Just AMAZING!!!

As an AA employee, I agree with most of what you said except the last part. But, not in the way you might think. I disagree with the "WN is coming to kill us/you" philosophy.

To my mind, WN is coming to make a profit. Their motives are not altruistic, but they aren't murderous either. Even if the worst airline in the world is the only one serving a particular market, WN will not move into that market unless they believe they can make a profit in that market. Look at their route map. There are a number of whole states that WN chooses not to serve.

I agree that with our current system, the rest of us are certainly handing them some opportunities, but I think that taking advantage of an opportunity is good business, not murderous intent.

WN management are geniuses at doing what they do extremely well. They don't offer anything other than transportation from Point A to Point B at a reasonable price. Because of the myriad "if the wind is from the South and this is the 3rd Tuesday of the month" pricing schemes the rest of us foist upon the public in the pursuit of "yield management," that reasonable fare translates in the public's mind to the "lowest fare." It's not something WN claims, it's just jam on the bread they get free of charge through public perception. WN points out that they have a low fare with no additional fees. They never (that I have seen) claim the lowest fare.

I commute to STL on WN often (DAL is closer to my home than DFW). I am constantly amazed at how nice ALL their employees are. I wish some of our gate agents and f/as could be sent to them for training.

 

[oldiebutgoody]

As long as they keep paying US Airways under the table to keep Parker and Kirby, Parker and Kirby will keep doing the dumb stuff Southwest wants.

Where is the SEC?

I understand that there is a BIG effort in Congress to change the futures trading laws regarding petroleum. Many think that it is partly responsible for the nonsensical rise of oil prices.

This could have the effect, if it comes to pass, and I'm not saying that it will, of leveling the playing field IMMEDIATELY.

 

[N965VJ]

WN is also good and managing the truly non-renewable resource: time.

 

[autofixer]

I understand that there is a BIG effort in Congress to change the futures trading laws regarding petroleum. Many think that it is partly responsible for the nonsensical rise of oil prices.

This could have the effect, if it comes to pass, and I'm not saying that it will, of leveling the playing field IMMEDIATELY.

Nope, oil trading will just move to the over-the-counter market or to the London market. Congress is about to screw things up royally...again. They have no concept at how the markets work, but what should one expect from a bunch of Socialists in Congress.

 

[oldiebutgoody]

Nope, oil trading will just move to the over-the-counter market or to the London market. Congress is about to screw things up royally...again. They have no concept at how the markets work, but what should one expect from a bunch of Socialists in Congress.

You think that if the US changes the rules that Parliament won't, as well? Hmm. I doubt that. Also, the Saudis are pushing for changes, as well.

If trading oil futures trading becomes a no-no, then corporations will NOT be allowed to do it, or they'll face SEC or legal penalties. You won't be able to read about it on corporate balance sheets or annual reports.

I don't think it will occur in the US for one reason, CASH. We all know that as far as Congress is concerned, the Golden Rule is the law of the land, "he who has the gold rules".

Personally, I think that trading futures is tantamount to gambling, and it shouldn't be legal at all. Hedge funds and the like are basically placing a bet against a particular industry, which only raises the emotional extremes of the stock market.

 

[vantheman63]

I understand that there is a BIG effort in Congress to change the futures trading laws regarding petroleum. Many think that it is partly responsible for the nonsensical rise of oil prices.

This could have the effect, if it comes to pass, and I'm not saying that it will, of leveling the playing field IMMEDIATELY.

This is EXACTLY right....see my post on the topic: http://www.usaviation.com/forums/index.php...st&p=618981

Many people have, in my opinion, incorrectly placed Bush at the center of this crisis...and drilling in new and other places...when I believe the real issues is futures trading.

In every "game" there is a winner and loser....in this "game," the losers are consumers buying gas and airline tickets...the winners are the investors bidding prices up...and WN is also a winner in this game.

So, this "trading rule" (futures on oil) goes away...and you know who will start to lose from it....I wonder where their lobbyists are having dinner tonight???

 

[vantheman63]

You think that if the US changes the rules that Parliament won't, as well? Hmm. I doubt that. Also, the Saudis are pushing for changes, as well.

If trading oil futures trading becomes a no-no, then corporations will NOT be allowed to do it, or they'll face SEC or legal penalties. You won't be able to read about it on corporate balance sheets or annual reports.

I don't think it will occur in the US for one reason, CASH. We all know that as far as Congress is concerned, the Golden Rule is the law of the land, "he who has the gold rules".

Personally, I think that trading futures is tantamount to gambling, and it shouldn't be legal at all. Hedge funds and the like are basically placing a bet against a particular industry, which only raises the emotional extremes of the stock market.

Boy, this is another post that is absolutely correct and accurate.

First off, the "Golden Rule" is the most overlooked rule in the books. Exactly right, "he who has the gold, makes the rules."

People don't realize the size of the US Economy as it relates to the rest of the world. I remember the run up to the real estate bubble crashing....and people saying, "the Chinese will end up owing the US!" I had to generate MULTIPLE "face palms" on that....because its just silly (read: NOT THINKING) to believe that. First off, the US Economy is 8 times the size of the Chinese economy...secondly, they would set themselves up for a complete collapse if they tried "calling the notes" on US debt. Not smart. When the US catches a cold, the rest of the world grabs for a kleenex.

London, Parliment, everyone would do the same thing. NO ONE likes how this is playing out...which is why the fat lady is tuning her vocal chords up now.

So many people love and revere Warren Buffet and to a lessor degree, George Soros....AND THEY ARE THE PEOPLE THAT WORKED, successfully I might add, AT SINKING THE DOLLAR AND EXASPERATING THE PROBLEMS!!!

We see this crap in the media about how the EU hates George Bush...they don't hate George Bush, they simply don't care for US policy during a GOP Administration that works at devaluing the dollar a bit to keep American goods and services in demand overseas. Then Buffett and Soros, who are media darlings, BROADCAST AND TELL THE WORLD "we're going to buy Euros" and they create a frenzie....until the Central EU bank said, "stop it or we'll stop you."

And it's also correct...OPEC, the Saudis, EVEN THE FRIGGIN IRANIANS (!!!) are on record saying "this is not good." Believe it or not, OPEC has a vested interest in the world's economy staying healthy. LOL

Its amazing what people will read in USA Today...and then believe....without taking 3 minutes to really think it all the way through.